Service tax on hired Tractor with Trolley

[Guest]

Dear Sir,

Please explain service tax on hired tractor with trolley. Service tax levied or not??

Thanks & Regards,

Sanjay Vasava

[YAGAY andSUN]

It will depend on the following aspects, viz:

1. Effective possession and control
2. Service Provider whether crossed the Threshold limit or not.
3. Whether Right to use was involved or not?

[Rajagopalan Ranganathan]

Sir,

Service tax is leviable under "Tangible Goods Supply Service".

[YAGAY andSUN]

Recently CBEC has provided clarification on this aspect, which is being reproduced for your ready reference

Circular No 198/08/2016-Service Tax New Delhi, the 17^th August, 2016

[Ganeshan Kalyani]

If service tax is paid on such transaction then sales tax is not applicable and vice-versa.

AI Summary

Tangible Goods Supply Service: levy depends on effective possession, control and right to use; may preclude sales tax. Service tax on hired tractors with trolleys is assessed as a Tangible Goods Supply Service; chargeability depends on effective possession and control, existence of a right-to-use arrangement, and whether the supplier meets the registration threshold, and a paid service tax generally excludes state sales tax on the same transaction.